Welcome to another edition of Payout Perspective. This time we take a look at UFC 188 taking place from Mexico City, Mexico.

Werdum Undisputed HW Champ

Fabricio Werdum defeated Cain Velasquez to earn the undisputed Heavyweight title. It was a submission that ended the long-running win streak of Fedor Emelianenko. It was another submission that ended the Heavyweight title reign of Cain Velasquez. Werdum’s guillotine choke ended the night for Cain who seemed gassed despite continuing to come forward during the fight. It was one final lunge at Velasquez that spelled his doom as it seemed that Werdum had a smile on his face as Cain attempted a takedown but was caught by Werdum.

It has been two years since Cain Velasquez had been in the Octagon. It probably was not rust from not fighting but the altitude of Mexico City that could have been the issue. He spent two weeks in Mexico City but Werdum had been there for over a month.

Werdum could face Andre Arlovski or Stipe Miocic next.

Alvarez escapes Gil

Eddie Alvarez scored a split decision over Gilbert Melendez in an exciting co-main event. Despite having his left eye almost shut after round 1 due to a Gil elbow strike, Alvarez came back in rounds 2 and 3 to eke out the win. It must have been a relief for Alvarez to finally get a W in the Octagon after his ordeal with Bellator and losing in his UFC debut last fall.

The decision could have gone either way and these two probably do not lose too much (Eddie #4, Gil #5) in the rankings after the fight.

Next up for Eddie Alvarez? Possibly Benson Henderson since they were originally scheduled to fight earlier this year. We could see this in South Korea in November.

Attendance and Gate

The event drew 21,036 which was 36 more than the UFC’s event last year in the same venue. No gate was announced so we do not know if how many comps were provided.

Bonuses

Fabricio Werdum, Patrick Williams, Yair Rodriguez and Charles Rosa earned the $50,000 fight bonuses. Werdum and Williams earned the Performances of the Night and Rodriguez and Rosa earned the Fight of the Night.

Promotion of the Fight

UFC Embeddeds provided some controversy as Werdum accused Cain of being a “Fake Mexican.” Essentially, Cain is American first and not from Mexico. It was an interesting accusation that reminded me of Oscar de la Hoya-Fernando Vargas from years past. Of course with recent news events about identity, it would be topical if not for the fact that no one seemed to care.

Similar to UFC 180, Doritos advertised for this fight by having the fighters’ likenesses on Doritos bags. It also offered a contest for fans to meet and greet UFC fighters.

BetCris is a Mexican online gambling company. Self/Less is a movie from Universal Studios. It received a little promo featuring Forrest Griffin.

Cain added Monster Energy Drink to his list of sponsors which included Affliction, Oak Grove Technologies and American Ethanol.

Notably, Werdum was sponsored by Reddot.

Odds and Ends

Alvarez’s Underground King shirt, originally made by Jaco, is already on sale (i.e., reduced in price) at the UFC.com store.

Two fights ending in the first round on the UFC Prelims meant a very short night of fights on tv. Speaking of which, it was on FX instead of FS1 due to scheduling conflicts.

UFC 188 was shown in select theatres once again. It would be interesting to know how many people actually went to theatres to watch it.

Is Henry Cejudo ready for Demetrious Johnson yet?

Conclusion

In looking at the success of this event perhaps we look at how it did in comparison to past June PPVs. Traditionally, June PPVs have been terrible. The average PPVs from 2012-2014 is 132,000 buys. Google Trends for UFC 188 showed interest from Mexico by mediocre interest from the United States. Still, one would think that it had to improve on last June’s PPV of 115,000. I have an optimistic estimate of 200,000 PPV buys.

Saturday night competition was the NHL Stanley Cup playoff Game 6 on NBC between the Tampa Bay Lightning and Chicago Blackhawks. The game scored 5 million viewers and MLB Baseball on Fox which drew another 2.1 million (via TV By Numbers)

Payout Perspective:

The ratings were a modest decrease from UFC 187 but reflects a downturn this year which saw the first four UFC Prelims drawing over a 1 million viewer average. One would think that this should change next month with the big UFC 189 card and UIFC 190 in August featuring Ronda Rousey on the main card. The Prelims card was the lowest on FX since the Prelims have primarily been on based on the info we were able to dig up.

The UFC 185 Prelims on FX drew an average viewership of slightly over 1 million viewers with 1,003,000. The event which featured Ross Pearson versus Sam Stout peaked at 1,147,000 total viewers in the 9:30pm-9:45pm ET quarter hour.

It’s the fourth straight UFC Prelims which drew over 1 million viewers. The 185 Prelims were up 28% from the UFC 174 Prelims, the last time it was on FX (1,003,000 vs. 784,000). It was also up 36% in the A18-49 (532,000 vs. 390,000) since the last time it was on FX. The ratings are Live + Same Day viewership per Nielsen.

Payout Perspective:

Notably, all of the fights on the UFC 185 Prelims ended in stoppages. The trend of viewership topping over 1 million is a good sign for the UFC. Perhaps this was even a better accomplishment considering the prelims were moved to FX due to college basketball. The ratings reflect the fact that the audience actively recognized the change and decided to watch. FX does have more viewers than FS1, yet one might assume that most tuning in wanted to watch the fights.

In addition to all of the hype and promotion for Conor McGregor in lead-up to this Sunday’s UFC Fight Night: McGregor vs. Siver, McGregor will be hosting a Saturday afternoon fix of movies on FX featuring Irishmen.

On Saturday afternoon, January 17th, FX will play Gangs of New York, The Fighter and Taken 2. McGregor will host the afternoon of movies as he will be interjected during breaks offering his own commentary. An example of this is below:

Additionally, Fox is running a promo across its digital and social media properties with McGregor offering “Conorisms.” Note that the promo indicates McGregor-Siver occurs after the AFC Championship game.

Payout Perspective:

This is a unique investment in McGregor. Not only is McGregor hosting an afternoon of movies on FX, which is a bigger and broader audience than FS1, it has provided a slate of Irish-themed movies to tie-in with the UFC Featherweight. We will see if this support from FS1 sister property will help with the viewership.

MMA Payout has learned that Saturday night’s UFC Fight Night 54 which aired on multiple Fox networks due to MLB baseball drew a final overnight viewership number of 1,267,000 in the last hour of the event if you include viewership on both FX and FS1.

The event was simulcast on both stations as FX aired the complete UFC Fight Night card from Halifax while FS1 aired the last hour after the Washington Nationals-San Francisco Giants extra, extra inning game.

Broken down, the 3 hour and 2 minute main card on FX received an overall viewership of 413,000 and scored 0.20 in the overall adults 18-49 demo, 0.28 in the males 18-49 and 0.27 in the males 18-34. When the fights were switched onto FS1, there was a boost in viewership as that block received 799,000 viewers and scored 0.50 in the adults 18-49 demo, 0.71 in males 18-49 and 0.56 in males 18-34.

In addition, the prelims for UFC Fight Night 54 received a viewership of 102,000 in the 2 hour block on Fox Sports 2.

Payout Perspective:

I would say that we’d have to throw out the ratings for this night as MLB took it over on FS1. Still, to have 799,000 viewers tune into the last hour of the event likely meant a residual amount of people stayed and watched the fights. One would think that a great deal of the 413,000 viewers on FX were UFC fans (and not just people too lazy to turn their channel) that found the event after it was moved. The DVR numbers may not do much here since many people that wanted to watch the fights on FS1 wound up with a lot of baseball.

UFC Fight Night 54 was the second UFC event on Saturday and took place at Halifax Metro Centre in Nova Scotia, Canada. No comp information was released.

In addition to MacDonald winning a performance bonus for his KO of Tarec Saffiedine, bonuses of $50,000 each were given to Olivier Aubin-Mercier, Chad Kelades and Patrick Holohan. Kelades and Holohan earned the Fight of the Night.

Payout Perspective:

Most of us who were out and set our DVRs to FS1 will be looking for the re-runs for this. Kelades and Holohan was on FS2, but the bulk of the rest of the card was on FX due to the extra, extra inning game played between the Giants and Nationals. FS1 did switch back at the start of the Bryan Caraway-Raphael Assuncao.

Welcome to another edition of Payout Perspective. This time we take a look at UFC 174 from Rogers Arena in Vancouver, British Columbia, Canada where Demetrious Johnson showed why he is the pound for pound best fighter in the UFC.

Mighty Mouse outclasses Bagautinov

Rousey may be the biggest draw, Jones may be the face, Weidman may be the most liked, Cain may be the most devastating but Demetrious Johnson has to be considered the best pound for pound fighter in the UFC. Johnson showed his technical acumen and lightning quick speed in shutting out Ali Bagautinov in the 5 round main event. Johnson’s array of moves and speed were too much for the fourth-ranked fighter in the Flyweight division.

Johnson has cleaned out all the proven contenders in his division and maybe a rematch with John Dodson is next for Mighty Mouse. However, would a move up the 135 be something to look at down the road? Johnson’s only UFC defeated came at 135 at the hands of Dominick Cruz in October 2011.

MacDonald impressive over Woodley

There are times that Rory MacDonald looks disinterested in his fights, and there are times where he looks like the guy who wants to be champ by 25. On Saturday MacDonald looked like a contender by dominating Tyron Woodley. It was a dominating victory over a fighter that had the momentum to be considered for a title shot with an impressive win over the hometown MacDonald.

MacDonald likely will stand in line while waiting for a welterweight title shot behind the winner of the Matt Brown-Robbie Lawler matchup.

Attendance and gate

Although we do not know the exact configurations for Saturday’s UFC event, the Rogers Center holds 18,630. UFC 174 drew 13,506 for a gate of $1.14 million. This is noticeably down from UFC 131, the last time the organization came to the Rogers Arena. That event had 14,685 for a gate of $2.8 million. Prior to that, in 2010, UFC 115 at GM Place had 17,669 fans for over $4.2 million. UFC director of Canadian operations Tom Wright was quoted in the Vancover Sun on Sunday that the UFC was happy with coming to Vancouver and would be back.

According to SeatGeek, there was a lack of demand for the event as it saw seats on the secondary market selling below face value. The average resale for a ticket was $175.

Bonuses

The $50K bonuses were as follows:

Tae Hyun Bang: $100K for Fight of the Night and Performance of the Night

Kiichi Kunimoto: $50K Performance of the Night

Kajan Johnson: $50K Fight of the Night.

Johnson and Bang were awarded FOTN. Kunimoto pulled off an upset of Daniel Sarafian during the prelims portion of the card. Arguably, MacDonald and OSP could have been in the running for POTN as well as Letourneau-Phillips for FOTN.

Promotion for the Fight

The UFC Embedded series once again complemented the UFC Countdown show. The Embedded series is just like the 24/7/All-Access series the UFC had done in the past except this one is shorter and likely cheaper. While the online series focuses on White and then the featured fighters instead of vice versa, it’s still an interesting look behind the scenes of fight week.

There was coverage of the UFC in the local press. As well as a post-fight review by a columnist in the Vancouver Sun expressing her displeasure for the sport. While we try to be unbiased in reading opposing views to this sport, this column does a disservice to its readers by painting a picture with purported evidence which, if you dig into, does not support the writer’s initial thesis.

Since it was close to his hometown, Demetrious Johnson took the UFC belt over to the Seattle Seahawks training facility to meet some other world champions. He met All-Pro Safety Earl Thomas and it made the Seahawk Facebook page. He also made appearances in Seattle the week before fight week to promote the fight.

via Seattle Seahawks Facebook Page

Sponsors

The octagon sponsors included Fram, Las Vegas.com, Xyience, Boston Pizza, XboxOne, EA Sports’ UFC video game, UFC Fit and Bud Light in the center. EA Sports also had the fighter prep point. Its interesting to note that some of the usual Octagon sponsors did not have signage in the octagon tonight although most of the usual sponsors had other parts of the PPV (e.g., Harley Davidson, MetroPCS, etc…)

Las Vegas seems to be doing more promotion in lieu of International Fight Week. Boston Pizza is a UFC sponsor that is big in Canada. Xbox One is the one and only sponsor of Demetrious Johnson.

The biggest recognition for a sponsor for the night has to go to Tyron Woodley and his sponsor, Dude Wipes. DudeProducts.com make a wipe that doesn’t make dudes smell. The good news, the logo was placed directly on Woodley’s rear end and received a lot of response so much so that it was trending on twitter. The bad news is that Woodley lost.

Odds and Ends

The Prelims were on FX instead of FS1 which adds to the fact that this event might be one of the lowest viewed in a while.

Although this happened a couple weeks ago USA TaeKwonDo had its logo on the Octagon mat at the New Mexico Fight Night. Benson Henderson has a black belt in TKD which may be one of the reasons for its sponsorship.

Remember when Tim Tebow was a well-liked football player? Tebow was in attendance to little fan-fare from the Canadian crowd.

Who had the worse looking eye on Saturday night? Valerie Letourneau or Boxer Chris Algieri.

Feijao had a sponsor blacked out at weigh-ins. With his performance on Saturday, that sponsor is likely happy it had its name blacked out.

Conclusion

Going into this event, it did not seem like this would be a good viewing weekend. The last three years, June PPVs have been one of the weakest of the year. UFC 174 will carry this trend. While Johnson is one of the best around, he’s not a draw and there was nothing else on the card that would compel a casual viewer to pay to watch this card. Although not necessarily a correlation of the buy rate, the attendance for this event was lower than in 2011. A buy rate of 150,000 would not be out of the realm of possibility.

With its launch date Saturday, Fox Sports 1 replaces the Speed Channel and Fox Sports 2 replaces Fuel TV. But, DirecTV, Dish Network (Dish) and Time Warner Cable (TWC) do not have agreements to run FS1 and subscribers wonder if a deal will be done by Saturday.

DirecTV, Dish and TWC represent a total of about 46 million subscribers. Fox has promised investors that FS1 would reach 90 million households. But, if carriage deals are not brokered by Saturday, the FS1 launch will not reach its proposed audience. The problem has to do with carriage fees, the amount that distributors will need to pay to air the network.

Despite the fact that Wall Street thinks highly of the new channel, the issue is the rise in carriage fees. SNL Kagan indicates that cable and satellite operators pay 31 cents a month per subscriber (per Bloomberg story although SBJ story indicates 23 cents) for the Speed channel. Kagan estimates that FS1 will garner 80 cents per month in 2014 and could go as high as $1.50 per subscriber based on fee increases during the life of the deal. Its far from the $5.54 cents demanded for ESPN, but there is backlash from many non-sports subscribers about the rising cable/satellite costs that are passed along to all subscribers.

There have been dueling theories on whether the rights fee bubble will burst. Some argue that the rising fees passed along to subscribers will mean more cord-cutters and/or consumers looking to downsize its cable/satellite packages. The other school of thought is that in a time with DVRs and “Hoppers” live sporting events is the last space for advertisers on television. Citing sports as “DVR proof,” many television executives have looked to beefing up its inventory of network programs to include sports.

DirecTV, a satellite company forged on sports with the NFL Sunday Direct Ticket and Red Zone Channel is now one of the holdouts for Fox Sports 1. This could be due in part to its assessment of the ever-increasing rights fees it must pay (and pass along to subscribers).

With more networks now seeking more money, DirecTV is becoming more comfortable with not carrying specific channels that they consider too expensive. The result has been the type of public battles that, historically, had never included DirecTV.

Despite its sports lineage, DirecTV let Versus go dark for from August 2009 to March 2010 during the NHL Hockey season (Versus carried NHL games) before making amends with the network. Would it do the same with Fox Sports 1?

More recently, DirecTV and Fox squabbled over fees for the satellite company to carry 26 Fox channels. Luckily, the parties resolved its issues a day before a widespread blackout of Fox programming which would have included Fuel TV, FX and other Fox-owned cable channels.

It currently is in a nasty battle with the Pac 12 Network. Neither side is flinching in this impasse entering its second year. In fact, entering the 2013 College Football season, it has been announced that a deal between the two should not be expected. The Pac 12 Network has turned to an ad campaign urging DirecTV customers to switch providers if they would like its network.

Time Warner Cable is in a current battle with CBS over carriage fees which has not only turned the lights out on CBS but Showtime, a CBS property, to over 3 million subscribers of TWC. This could, if the impasse continues, indirectly affect Showtime boxing and shoulder programming leading up to the September 14th showdown between Floyd Mayweather, Jr. and Canelo Alvarez. TWC claims CBS is asking a 600 percent increase in fees which CBS scoffs at the accusation.

Dish Network has had its own issues with retransmission rights. It lost 78,000 subscribers in its second quarter of the year due to programming costs. It carries Fuel TV on a sports tier so those not subscribing to the sports tier will not even get Fox Sports 2. Then there is the rumor of a potential merger with DirecTV.

Payout Perspective:

DirecTV, Dish and TWC represent 46 million subscribers that would be without FS1 if something does not change. The three companies currently pay 31 cents per month for Speed. What FS1 is proposing is a jump in fees to 80 cents per month for FS1. This represents a 258% increase from the start. At stake is approximately $22.5 million between the three companies. This is based on the number of combined subscribers and the difference between the current fee versus the proposed fee (46M x .31 = 14.26M versus 46M x .80 = $36.80; $36.80M – $14.26M = $22.5M) (H/t: Adam Swift)

All three distributors indicate that they are still in negotiations with Fox on a deal that could have the channel launch on time. Even if a deal is not struck by August 17th, there is the possibility that deals occur shortly after FS1’s start date. From Fox’s perspective, it wants to make sure that it maximizes its rights fees while ensuring that all major distributors have availability to FS1. However, the distributors are feeling the pinch of the rising costs to carry these networks and it must decide how much more it can pass along to its subscribers without further backlash.

MMA Fighting reports that the UFC 162 Prelims received an average viewership of 1,363,000 viewers for a rating of 0.96. Due to the stunning knockout of Anderson Silva, Fuel TV saw an increase in its post-fight coverage with 214,000 viewers for a rating of 0.42.

Via MMA Fighting:

FX won its time slot not only on cable, but it’s 1.19 rating in the Male 18-34 time slot beat all network programming as well between 8 and 10 p.m. The 1.46 in Males 18-49 saw FX finish second in that time slot among both cable and network programming.

Not only did the post-fight coverage do well in ratings, but the weigh-ins also did well on Fuel as it received an average of 119,000 viewers for a 0.27 rating.

Notably, Chris Weidman’s last fight against Mark Munoz on July 11, 2012 scored 211,000 viewers, a lower amount than those tuning into watch the post-fight aftermath after winning the title.

Payout Perspective:

The ratings for 162 are slightly above the 1.3 average for prelims on FX. The prelims were highlighted by Gabriel Gonzaga’s quick KO of Dave Herman. The ancillary programming for UFC 162 meant that the marketing backing Chris Weidman helped with more viewers keying in on the weigh-ins to see the face off. Certainly, fans were not disappointed. The post-fight show viewership shot up due to the event and it was likely sparked by those that may not have watched the PPV but heard news of the KO. This bodes well for FS1 and its programming when the UFC moves to Fuel.

The Wrestling Observer reports that last week’s UFC 161 Prelims on FX scored 968,000 viewers for a rating of 0.68. The ratings were the third lowest ever on FX.

UFC 161 Prelims featured Jake Shields versus Tyron Woodley in one of the least exciting fights of the night. It did include the Fight and Submission of the Night with the James Krause defeat of Sam Stout. Yet, the Prelims were handily defeated in the ratings by The Stanley Cup on NBC and even College Baseball on ESPN.

…with numbers that resemble TNA more than UFC, a 0.63 in Males 18-34, almost shockingly low for UFC on FX in that demo, and 1.10 in Males 35-49.

The Observer also points out that the ratings were lower than any Prelim events the UFC had on Spike TV.

Payout Perspective:

The ratings reflect the fact that most of the UFC demo was tuned into the NHL or not tuned in at all. UFC 161 is probably not going to produce a high PPV number and the lead-in to the event didn’t help as it appears that some MMA fans decided to skip this event.